IGI Logo

Gold

Gold yesterday settled up by 0.8% at 56324 as cooling U.S. inflation raised hopes for slower interest rate hikes from the Federal Reserve. Data showed that U.S consumer prices fell for the first time in more than 2-1/2 years in December. Fed policymakers expressed relief that inflation continued to ease in December, paving the way for a possible step down to a quarter point interest rate increase at its next policy meeting in February. Premiums for physical gold rose sharply in China, buoyed by optimism around the country's reopening before Lunar New Year festivities, while Indian traders offered steeper discounts as record-high local prices dented consumer sentiment. Premiums as high as $30 an ounce over global benchmark spot prices were charged in top bullion consumer China, compared with last week's $8-$14 range. Dealers were offering a discount of up to $35 an ounce over official domestic prices up from the previous week's $32. India's gold imports in December plunged 79% from a year earlier to the lowest level in at least two decades for the month as a rally in local prices near record high dampened demand. India's gold imports in 2022 dropped to 706 tonnes from 1,068 tonnes a year ago. Technically market is under fresh buying as the market has witnessed a gain in open interest by 4.86% to settle at 12595 while prices are up 449 rupees, now Gold is getting support at 56026 and below same could see a test of 55728 levels, and resistance is now likely to be seen at 56496, a move above could see prices testing 56668.

Trading Ideas:

* Gold trading range for the day is 55728-56668.
* Gold prices scaled all time high as cooling U.S. inflation raised hopes for slower interest rate hikes from the Federal Reserve.
* Data showed that U.S consumer prices fell for the first time in more than 2-1/2 years in December.
* Premiums for physical gold rose sharply in China, buoyed by optimism around the country's reopening before Lunar New Year festivities

Silver
Silver yesterday settled up by 1.14% at 69427 amid bets that the Federal Reserve will soon ease up on its aggressive interest-rate hikes. The dollar index sank to fresh seven-month lows and Treasury yields extended declines, as fresh data showed U.S. consumer price inflation increased at a slower rate in December, matching expectations from economists. U.S. consumer inflation edged down by 0.1 percent in December after inching up by 0.1 percent in November. The annual rate of consumer price growth slowed to 6.5 percent from 7.1 percent in November, marking the smallest increase since October 2021. St. Louis Fed president James Bullard favored lifting rates above 5 percent as soon as possible, Philadelphia Fed President Patrick Harker supported smaller 25-basis-point rate hikes going forward. Inflation rate in the United States slowed for the sixth consecutive month in December, raising hopes for a less aggressive Federal Reserve tightening and supporting demand for silver as an industrial input for goods with high electricity conduction needs, which was reflected in the sharp rebound of solar energy equities. On the supply side, shortage concerns drove the commodity to outperform gold and palladium in 2022. COMEX inventories levels saw an aggressive decline in the period, and London Bullion Market Association stockpiles fell considerably amid outflows to India. Technically market is under fresh buying as the market has witnessed a gain in open interest by 7.88% to settle at 20541 while prices are up 784 rupees, now Silver is getting support at 68538 and below same could see a test of 67650 levels, and resistance is now likely to be seen at 69887, a move above could see prices testing 70348.

Trading Ideas:

* Silver trading range for the day is 67650-70348.
* Silver rose amid bets that the Federal Reserve will soon ease up on its aggressive interest-rate hikes.
* Fed policymakers expressed relief that inflation continued to ease in December.
* U.S. consumer price inflation increased at a slower rate in December, matching expectations


Crude oil
Crude oil yesterday settled up by 1.11% at 6462 on expectations of improved demand growth in China and hopes of less aggressive rate hikes in the United States. China's decision to reopen its international borders boosted hopes of higher oil demand. China reported better-than-expected trade figures, the U.K. economy unexpectedly grew in November and the German economy avoided contracting in the final quarter of the year, bolstering the global demand outlook. U.S. crude stocks built unexpectedly last week, the Energy Information Administration said, as refiners were slow to restore production after a cold freeze that shut operations. Crude inventories rose by 19 million barrels in the week ended Jan. 6 to 439.6 million barrels. It was the largest weekly build since February 2021, and the third-largest increase on record. Crude stocks at the Cushing, Oklahoma, delivery hub rose by 2.5 million barrels in the last week, EIA said. Net U.S. crude imports rose by 2.71 million barrels per day, bringing total net crude imports to 4.2 million bpd, the highest since July. Refinery crude runs rose by 831,000 barrels per day in the last week, EIA said, while refinery utilization rates rose by 4.5 percentage points in the week to 84.1%. U.S. gasoline stocks rose by 4.1 million barrels in the week to 226.8 million barrels, the EIA said. Technically market is under short covering as the market has witnessed a drop in open interest by -7.16% to settle at 5252 while prices are up 71 rupees, now Crude oil is getting support at 6389 and below same could see a test of 6317 levels, and resistance is now likely to be seen at 6504, a move above could see prices testing 6547.

Trading Ideas:

* Crude oil trading range for the day is 6317-6547.
* Crudeoil gains on expectations of improved demand growth in China and hopes of less aggressive rate hikes in the United States.
* China's decision to reopen its international borders boosted hopes of higher oil demand.
* U.S. crude stocks built unexpectedly last week, the Energy Information Administration said


Natural gas
Nat.Gas yesterday settled down by -6.91% at 292.4 as soaring domestic production offset prospects of a recovery in demand amid colder weather. US natural gas production is likely to grow more than 2% this year to a record daily average of 100.3 billion cubic feet, the Energy Information Administration said. At the same time, EIA data showed that utilities unexpectedly injected 11 bcf into storage last week. Adding to the bearish tone, the Freeport LNG export plant in Texas, forced to go offline in June following a fire, again delayed the restart to the second half of January, leaving more supply on the domestic market. US natural gas prices are down more than 20% since the beginning of 2023, the worst start of a year on record. Data provider Refinitiv said that average gas output in the U.S. Lower 48 states has risen to 98.4 bcfd so far in January, up from 96.7 bcfd in December. That compares with a monthly record of 99.9 bcfd in November 2022. With the weather expected to remain warmer than normal until late January, Refinitiv projected average U.S. gas demand, including exports, would ease from 121.2 bcfd this week to 119.4 bcfd next week. The forecast for this week was higher than Refinitiv's outlook on Wednesday. Technically market is under fresh selling as the market has witnessed a gain in open interest by 12.41% to settle at 25634 while prices are down -21.7 rupees, now Natural gas is getting support at 284.7 and below same could see a test of 277.1 levels, and resistance is now likely to be seen at 305.2, a move above could see prices testing 318.1.

Trading Ideas:

* Natural gas trading range for the day is 277.1-318.1.
* Natural gas dropped as soaring domestic production offset prospects of a recovery in demand amid colder weather
* US natural gas production is likely to grow more than 2% this year to a record daily average of 100.3 billion cubic feet
* EIA data showed that utilities unexpectedly injected 11 bcf into storage last week.



Copper
Copper yesterday settled up by 0.36% at 772 as supply concerns and demand optimism from hopes of an easing in rate hikes by the U.S. Federal Reserve underpinned prices. China's zero-COVID policy stifled metals demand from the world's biggest metals consumer. The abandonment of the policy, however, has caused a wave of COVID-19 infections likely to last for two to three months. Supply concerns, arose from Peru, is currently in the throes of the worst civil unrest in years. Vandals attacked Glencore's Antapaccay copper mine in Peru, the country's top mining official said, amid a deepening political crisis marked by violent protests that have broken out near major mines in the southern Andes. Peruvian mine Minsur temporarily suspended operations at its San Rafael tin mine, the company said, adding it took the decision in solidarity with the victims of recent protests. China imported 514,049 tonnes of unwrought copper and copper products in December, down 12.7% from a year earlier, data from the General Administration of Customs showed. China's copper concentrate imports totalled 42.3 million tonnes in 2022, an all-time high according to data from the General Administration of Customs. That year's imports were up 80.5% from 23.44 million tonnes imported in 2021. Technically market is under short covering as the market has witnessed a drop in open interest by -0.75% to settle at 5412 while prices are up 2.75 rupees, now Copper is getting support at 765.1 and below same could see a test of 758.2 levels, and resistance is now likely to be seen at 775.8, a move above could see prices testing 779.6.

Trading Ideas:

* Copper trading range for the day is 758.2-779.6.
* Copper rose amid supply concerns and demand optimism from hopes of an easing in rate hikes by the U.S. Federal Reserve.
* China Dec copper imports at 514,049 tonnes – customs
* China's 2022 copper concentrate imports at all – time high


Zinc
Zinc yesterday settled up by 2.09% at 288.55 as stockpiles in LME-registered warehouses fell to 20,975 tonnes, the lowest on record and down from almost 300,000 tonnes in early 2022. China's zero-COVID policy stifled metals demand from the world's biggest metals consumer. On the supply side, inventories remain at record lows as the power crisis in Europe forced several smelters to operate at reduced capacity, while others were placed on care and maintenance, including the Budel smelter in the Netherlands, the Nordenham smelter in Germany, and the Auby smelter in France. As China's new year holiday approaches, market activity slows down, and the domestic stock accumulates. Global zinc stocks closed 2022 at 42,825 tonnes, an 84.7% reduction from the beginning of the year. The People’s Bank of China injected a total CNY 132 billion of reverse repos into the banking system on Friday, including CNY 55 billion through the seven-day tenor and CNY 77 billion through the 14-day tenor, while keeping the rate unchanged at 2% and 2.15%, respectively. It was the third straight day of offering this year. The central bank said the move aims to maintain the reasonable and sufficient liquidity in the banking system ahead of Lunar New Year Holidays, according to an online statement. Technically market is under fresh buying as the market has witnessed a gain in open interest by 4.27% to settle at 2151 while prices are up 5.9 rupees, now Zinc is getting support at 285 and below same could see a test of 281.3 levels, and resistance is now likely to be seen at 291, a move above could see prices testing 293.3.

Trading Ideas:

* Zinc trading range for the day is 281.3-293.3.
*Zinc prices rallied as stockpiles in LME-registered warehouses fell to 20,975 tonnes, the lowest on record.
* China's zero-COVID policy stifled metals demand from the world's biggest metals consumer.
* The People’s Bank of China injected a total CNY 132 billion of reverse repos into the banking system


Aluminium
Aluminium yesterday settled up by 1.62% at 219.1 helped by optimism over top consumer China's reopening, while a shaky U.S. dollar also lent support. Aluminium producer Alcoa Corp said it expects production at its partially owned Kwinana alumina refinery in Western Australia to be cut by about 30% due to a shortage of gas supply. A unit of the refinery, majority owned by Alcoa in a joint venture with Alumina Ltd, has been taken offline, hitting process flows, the aluminium producer said in statement. China will take steps to improve the cash flows of high-quality property developers, Zou Lan, head of the monetary policy department at the People's Bank of China, told a press conference. China's central bank will take further measures to boost market confidence and guide financial institutions to boost support for manufacturers and small firms, Xuan Changneng, deputy government of the People's Bank of China, told. The People’s Bank of China injected a total CNY 132 billion of reverse repos into the banking system on Friday, including CNY 55 billion through the seven-day tenor and CNY 77 billion through the 14-day tenor, while keeping the rate unchanged at 2% and 2.15%, respectively. Technically market is under fresh buying as the market has witnessed a gain in open interest by 0.36% to settle at 5332 while prices are up 3.5 rupees, now Aluminium is getting support at 216.9 and below same could see a test of 214.7 levels, and resistance is now likely to be seen at 220.7, a move above could see prices testing 222.3.

Trading Ideas:

* Aluminium trading range for the day is 214.7-222.3.
* Aluminium rose helped by optimism over top consumer China's reopening, while a shaky U.S. dollar also lent support.
* China will take steps to improve cash flows of high – quality property developers: c.bank official
* China to take further measures to boost market confidence, says deputy c.bank governor


Mentha oil
Mentha oil yesterday settled up by 1.44% at 1064.5 on improving export demand especially from China. Mentha exports during Apr-Nov 2022 has dropped by 18.10 percent at 1,485.25 tonnes as compared to 1,813.38 tonnes exported during Apr- 2022 2021. In the month of November 2022 around 236.22 tonnes Mentha was exported as against 141.82 tonnes in October 2022 showing a rise of 66.56%. In the month of November 2022 around 236.22 tonnes of Mentha was exported as against 249.26 tonnes in November 2021 showing a drop of 5.23%. Many states have seen gutkha and pan masala ban which have seen a lower demand from the pan masala industry. The production of Mentha oil was historically high in 2020-21, the area remained almost similar last year but the yields were lower which affected the production. In the current year, production to fall to around 46,238 MT due to sharp fall in area and loss in yields following severe summer heat. which will come closed 14% down in the year 20-21. In Sambhal spot market, Mentha oil gained by 5.7 Rupees to end at 1202 Rupees per 360 kgs.Technically market is under short covering as the market has witnessed a drop in open interest by -1.13% to settle at 962 while prices are up 15.1 rupees, now Mentha oil is getting support at 1051.2 and below same could see a test of 1037.8 levels, and resistance is now likely to be seen at 1072.9, a move above could see prices testing 1081.2.

Trading Ideas:

* Mentha oil trading range for the day is 1037.8-1081.2.
* In Sambhal spot market, Mentha oil gained  by 5.7 Rupees to end at 1202 Rupees per 360 kgs.
* Mentha oil prices gained on improving export demand especially from China.
* Mentha exports during Apr-Nov 2022 has dropped by 18.10 percent at 1,485.25 tonnes
* In the month of November 2022 around 236.22 tonnes of Mentha was exported as against 249.26 tonnes in November 2021


Turmeric
Turmeric yesterday settled down by -1.15% at 7738 on an “unexpected” slump in domestic and export demand. Turmeric production in the 2021-22 crop year (June-July) has been projected at 13.31 lakh tonnes against 11.24 lakh tonnes the previous year with the area increasing to 3.5 lakh hectares from 2.93 lakh hectares. In the first advance estimate, the crop was pegged at 11.76 lakh tonnes. Turmeric exports during Apr-Nov 2022 has rose by 9.90 percent at 1,11,968.51 tonnes as compared to 1,01,882.03 tonnes exported during Apr-Nov 2021. In the month of November 2022 around 12,398.63 tonnes turmeric was exported as against 11,178.11 tonnes in October 2022 showing a rise of 10.92%. In the month of November 2022 around 12,398.63 tonnes of turmeric was exported as against 12,255.64tonnes in November 2021 showing a rise of 1.17%. Production of spices in India is likely to have declined 1.5% on year to 10.9 mln tn in 2021-22 (Jul-Jun), according to data from Spices Board India. The country had produced 11.0 mln tn of spices in the previous year. The Spices Board has pegged turmeric production at 1.33 mln tn, up 18.4% on year. In Nizamabad, a major spot market in AP, the price ended at 7357.45 Rupees dropped -51.85 Rupees.Technically market is under fresh selling as the market has witnessed a gain in open interest by 0.9% to settle at 12845 while prices are down -90 rupees, now Turmeric is getting support at 7674 and below same could see a test of 7610 levels, and resistance is now likely to be seen at 7840, a move above could see prices testing 7942.

Trading Ideas:

* Turmeric trading range for the day is 7610-7942.
* Turmeric prices dropped on an “unexpected” slump in domestic and export demand.
* Turmeric production in 2023 has been projected at 5.13 Lakh Mt against 4.67 Lakh Mt the previous year
* Marathwada region has been serving as a round-the-year supply centre for Turmeric since past couple of years.
* In Nizamabad, a major spot market in AP, the price ended at 7357.45 Rupees dropped -51.85 Rupees.


Jeera
Jeera yesterday settled up by 2.81% at 37100 amid reduced sowing in Gujarat, coupled with a tight supply, and climatic uncertainties. Projections of lower carryover stock and fears of sowing in key growing regions of Gujarat being affected. Sowing In Gujarat, dropped by nearly -8% with 274,995.00 hectares against sown area of 2021 which was 300,401.00 hectares. Prices gained to all time high amid higher demand for the fresh crop and supply tightness in the physical market. Good demand expected from China in December-January and Ramzan demand during January-February from gulf & other countries. Jeera exports during Apr-Nov 2022 has dropped by 17.40 percent at 133,250.24 tonnes as compared to 161,317.94 tonnes exported during Apr-Nov 2021. In the month of November 2022 around 11,235.11 tonnes jeera was exported as against 12,427.86 tonnes in October 2022 showing a drop of 9.60%. In the month of November 2022 around 11,235.11 tonnes of jeera was exported as against 10,838.83 tonnes in November 2021 showing a rise of 3.66%. Production of spices in India is likely to have declined 1.5% on year to 10.9 mln tn in 2021-22 (Jul-Jun), according to data from Spices Board India. The country had produced 11.0 mln tn of spices in the previous year. Jeera production was seen at 725,651 tn, down 8.8% on year due to lower acreage in Rajasthan and Gujarat, the key producer, according to data from Spices Board India. According to fourth advanced estimates by Gujarat government, jeera production is seen fall by 44.5 per cent to 221500 tonnes in 2021-22 on yoy basis. In Unjha, a key spot market in Gujarat, jeera edged up by 51.75 Rupees to end at 35069.1 Rupees per 100 kg.Technically market is under fresh buying as the market has witnessed a gain in open interest by 17.07% to settle at 5349 while prices are up 1015 rupees, now Jeera is getting support at 36430 and below same could see a test of 35755 levels, and resistance is now likely to be seen at 37585, a move above could see prices testing 38065.

Trading Ideas:

* Jeera trading range for the day is 35755-38065.
* Jeera prices gained amid reduced sowing in Gujarat, coupled with a tight supply, and climatic uncertainties.
* Projections of lower carryover stock and fears of sowing in key growing regions of Gujarat being affected.
* Sowing in Gujarat, dropped by nearly -8% with 274,995.00 hectares against sown area of 2021 which was 300,401.00 hectares.
* In Unjha, a key spot market in Gujarat, jeera edged up by 51.75 Rupees to end at 35069.1 Rupees per 100 kg.
 

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaimer